QCRH QCR Holdings Inc

QCR Holdings, Inc. (NASDAQ: QCRH) (the “Company”) today announced record net income of $31.6 million and diluted earnings per share (“EPS”) of $1.99 for the third quarter of 2021, compared to net income of $22.3 million and diluted EPS of $1.39 for the second quarter of 2021.

Adjusted net income (non-GAAP) and adjusted diluted EPS (non-GAAP) for the third quarter of 2021 were the same as GAAP net income and diluted EPS, as there were no meaningful non-core adjustments during the quarter. For the second quarter of 2021, adjusted net income (non-GAAP) was $22.5 million and adjusted diluted EPS (non-GAAP) was $1.40. For the third quarter of 2020, adjusted net income (non-GAAP) and adjusted diluted EPS (non-GAAP) were $17.7 million and $1.11, respectively.

		For the Quarter Ended
		September 30,		June 30,		September 30,
	$ in millions (except per share data)	2021		2021		2020
	Net Income	$	31.6	$	22.3	$	17.3
	Diluted EPS	$	1.99	$	1.39	$	1.09
	Adjusted Net Income (non-GAAP)	$	31.6	$	22.5	$	17.7
	Adjusted Diluted EPS (non-GAAP)	$	1.99	$	1.40	$	1.11

______________________________Adjusted non-GAAP measurements of financial performance exclude non-recurring income and expense items that management believes are not reflective of the anticipated future operation of the Company’s business. The Company believes these measurements provide a better comparison for analysis and may provide a better indicator of future performance. See GAAP to non-GAAP reconciliations.

“We are very pleased with our outstanding financial performance for the third quarter,” said Larry J. Helling, Chief Executive Officer. “We delivered another record quarter of net income, driven by exceptional loan growth, strong fee income, an expanded net interest margin and strong credit quality. We grew core loans 23% on an annualized basis, largely funded with core deposit growth of 16%. This exceptional performance is reflective of our core values, one of which is our relationship-based community banking model, emphasizing the importance of strong relationships with new and existing clients.”

Annualized Loan and Lease Growth of 23% for the Quarter and 18% YTD, excluding PPP Loans (non-GAAP)

During the third quarter of 2021, the Company’s core loans and leases, excluding PPP loans, increased $246.0 million to a total of $4.5 billion. Core loan and lease growth during the quarter was 23.0% on an annualized basis and was funded by core deposit growth and some excess liquidity. Core deposits (excluding brokered deposits) increased by $183.0 million during the quarter. The Company’s wholesale funding portfolio has been reduced to predominately subordinated debt that qualifies as regulatory capital.

“Our continued robust loan growth was driven primarily by strength in our Specialty Finance Group as well as continued growth in our traditional commercial lending and leasing business,” added Helling. “Given the 18% annualized loan growth we have delivered over the first nine months of 2021, combined with our current pipeline, we are now targeting organic loan growth for the full year 2021 of between 16% and 18%.”

Record Net Interest Income of $46.2 million

Net interest income for the third quarter of 2021 totaled $46.2 million, compared to $43.5 million for the second quarter of 2021 and $44.6 million for the third quarter of 2020. Adjusted net interest income (non-GAAP) during the quarter was $48.5 million, an increase of $2.8 million, or 6.2%, from the prior quarter, due to an increase in adjusted NIM combined with strong loan/lease growth. Adjusted net interest income (non-GAAP) was $45.7 million for the third quarter of 2020. Acquisition-related net accretion totaled $456 thousand for the third quarter of 2021, up from $291 thousand in the second quarter of 2021 and down from $833 thousand for the third quarter of 2020.

In the third quarter, reported NIM was 3.36% and tax-equivalent yield basis (non-GAAP) NIM was 3.56%, compared to 3.28% and 3.46% in the prior quarter, respectively. Adjusted NIM (non-GAAP), which excludes acquisition-related net accretion, was 3.53%, up 9 basis points from the second quarter. The increase in Adjusted NIM (non-GAAP) during the quarter was primarily due to a 7 basis point increase in the yield on earning assets (adjusted for acquisition-related net accretion, non-GAAP) driven by fees associated with $63.9 million of PPP loans that were forgiven during the quarter. In addition, adjusted NIM benefited from a decline of 2 basis points in the total cost of interest-bearing funds (due to both mix and rate).

		For the Quarter Ended
		September 30,	June 30,	September 30,
		2021	2021	2020
	NIM	3.36%	3.28%	3.36%
	NIM (TEY)(non-GAAP) *	3.56%	3.46%	3.51%
	Adjusted NIM (TEY)(non-GAAP) *	3.53%	3.44%	3.44%
	* See GAAP to non-GAAP reconciliations

“We expanded our NIM again during the third quarter, bolstered by higher PPP fees, lower deposit costs and relatively stable core loan yields in this highly competitive lending environment,” said Todd A. Gipple, President, Chief Operating Officer and Chief Financial Officer. “With our strong loan and lease growth and margin expansion, net interest income grew by 6% in the quarter when excluding the impact of acquisition accounting.”

Noninterest Income of $34.7 million

Noninterest income for the third quarter of 2021 totaled $34.7 million, compared to $19.3 million for the second quarter of 2021. The increase was primarily due to a $15.3 million increase in capital markets revenue from the prior quarter. Wealth management revenue was $3.8 million for the quarter, consistent with the second quarter.

“Capital markets revenue totaled $24.9 million for the quarter, which benefited from a number of swap transactions that were scheduled to close in the second quarter carrying over into the third quarter,” added Gipple. “Capital markets revenue averaged $16 million per quarter for the first nine months of 2021 and $16.3 million for the last eight quarters. This gives us confidence in the sustainability of this important source of fee income and supports our continued guidance range of $14 to $18 million per quarter.”

Noninterest Expenses of $41.4 million

Noninterest expense for the third quarter of 2021 totaled $41.4 million, compared to $35.7 million for the second quarter of 2021 and $40.8 million for the third quarter of 2020. The linked-quarter increase was primarily due to higher performance-based salary and benefits expense of $5.2 million, driven by strong capital markets revenue production and earnings performance during the quarter. Additionally, the Company recorded a $1.5 million charge related to the write-down of certain fixed assets. Partially offsetting these increases was a $1.3 million net gain on the sale of other real estate.

Asset Quality Remains Strong and NPAs Improved

Nonperforming assets (“NPAs”) totaled $6.8 million at the end of the third quarter, a decrease of $3.3 million from the second quarter of 2021. The decrease was primarily due to the sale of a commercial property classified as other real estate owned and a reduction in nonaccrual loans that either returned to performing status or were monetized during the quarter. The ratio of NPAs to total assets improved to 0.11% on September 30, 2021, compared to 0.17% on June 30, 2021, and 0.31% on September 30, 2020. In addition, the Company’s criticized loans and classified loans to total loans and leases decreased to 2.57% and 1.29%, respectively, from 2.97% and 1.80% as of June 30, 2021.

The Company did not record a provision for credit losses in the third quarter of 2021, primarily due to continued strong asset quality and a reduction in nonperforming loans. Similarly, there was no provision for credit losses recorded in the second quarter of 2021. As of September 30, 2021, the ACL on total loans/leases was 1.75%, compared to 1.79% as of June 30, 2021. Excluding PPP loans of $84 million, the ACL to total loans/leases as of September 30, 2021, was 1.79% (non-GAAP).

Continued Strong Capital Levels

As of September 30, 2021, the Company’s total risk-based capital ratio was 14.51%, the common equity tier 1 ratio was 10.45% and the tangible common equity to tangible assets ratio (non-GAAP) was 9.54%. By comparison, these respective ratios were 14.72%, 10.52% and 9.55% as of June 30, 2021. During the third quarter, the Company continued its existing share repurchase program and purchased and retired 193,153 shares at an average price of $48.50 per share.

Focus on Three Strategic Long-Term Initiatives

As part of the Company’s ongoing efforts to grow earnings and drive attractive long-term returns for shareholders, it continues to operate under three key strategic long-term initiatives:

• Generate organic loan and lease growth of 9% per year, funded by core deposits;
• Grow fee-based income by at least 6% per year; and
• Limit our annual operating expense growth to 5% per year.

Conference Call Details

The Company will host an earnings call/webcast tomorrow, October 28, 2021, at 10:00 a.m. Central Time. Dial-in information for the call is toll-free: 888-346-9286 (international 412-317-5253). Participants should request to join the QCR Holdings, Inc. call. The event will be available for replay through November 11, 2021. The replay access information is 877-344-7529 (international 412-317-0088); access code 10159948. A webcast of the teleconference can be accessed at the Company’s News and Events page at www.qcrh.com. An archived version of the webcast will be available at the same location shortly after the live event has ended.

About Us

QCR Holdings, Inc., headquartered in Moline, Illinois, is a relationship-driven, multi-bank holding company serving the Quad Cities, Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield communities through its wholly-owned subsidiary banks. The banks provide full-service commercial and consumer banking and trust and wealth management services. Quad City Bank & Trust Company, based in Bettendorf, Iowa, commenced operations in 1994, Cedar Rapids Bank & Trust Company, based in Cedar Rapids, Iowa, commenced operations in 2001, Community State Bank, based in Ankeny, Iowa, was acquired by the Company in 2016, and Springfield First Community Bank, based in Springfield, Missouri, was acquired by the Company in 2018. Additionally, the Company serves the Waterloo/Cedar Falls, Iowa community through Community Bank & Trust, a division of Cedar Rapids Bank & Trust Company. Quad City Bank & Trust Company offers equipment loans and leases to businesses through its wholly-owned subsidiary, m2 Equipment Finance, LLC, based in Milwaukee, Wisconsin, and also provides correspondent banking services. The Company has 24 locations in Iowa, Missouri, Wisconsin and Illinois. As of September 30, 2021, the Company had approximately $6.0 billion in assets, $4.6 billion in loans and $4.9 billion in deposits. For additional information, please visit the Company’s website at www.qcrh.com.

Special Note Concerning Forward-Looking Statements. This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “predict,” “suggest,” “appear,” “plan,” “intend,” “estimate,” ”annualize,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.        A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local, state, national and international economies; (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics (including the COVID-19 pandemic in the United States), acts of war or other threats thereof, or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the FASB or the PCAOB; (iv) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (v) changes in interest rates and prepayment rates of the Company’s assets (including the impact of LIBOR phase-out); (vi) increased competition in the financial services sector and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; and (xiii) the ability of the Company to manage the risks associated with the foregoing as well as anticipated. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

Contacts:
Todd A. Gipple		Kim K. Garrett
President		Vice President
Chief Operating Officer		Corporate Communications
Chief Financial Officer		Investor Relations Manager
(309) 743-7745		(319) 743-7006
tgipple@qcrh.com		kgarret@qcrh.com

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
		As of
		September 30,		June 30,		March 31,		December 31,		September 30,
		2021		2021		2021		2020		2020
		(dollars in thousands)
CONDENSED BALANCE SHEET
Cash and due from banks		$	57,310	$	55,598	$	78,814	$	61,329	$	68,932
Federal funds sold and interest-bearing deposits			70,826		88,780		55,056		95,676		302,668
Securities, net of allowance for credit losses			828,719		810,445		799,825		838,131		782,088
Net loans/leases			4,519,060		4,338,811		4,279,220		4,166,753		4,168,395
Intangibles			9,857		10,365		10,873		11,381		11,902
Goodwill			74,066		74,066		74,066		74,066		74,066
Derivatives			198,393		193,395		122,668		222,757		236,381
Other assets			256,277		233,705		224,625		212,704		220,128
Total assets		$	6,014,508	$	5,805,165	$	5,645,147	$	5,682,797	$	5,864,560
Total deposits		$	4,871,828	$	4,688,935	$	4,631,782	$	4,599,137	$	4,672,268
Total borrowings			183,514		198,908		188,601		177,114		226,962
Derivatives			201,450		196,092		125,863		229,270		244,510
Other liabilities			107,902		90,754		90,182		83,483		148,207
Total stockholders' equity			649,814		630,476		608,719		593,793		572,613
Total liabilities and stockholders' equity		$	6,014,508	$	5,805,165	$	5,645,147	$	5,682,797	$	5,864,560
ANALYSIS OF LOAN PORTFOLIO
Loan/lease mix: (1)
Commercial and industrial - revolving		$	175,155	$	182,882	$	168,842
Commercial and industrial - other			1,465,580		1,505,384		1,616,144
Commercial real estate, owner occupied			434,014		427,734		461,272
Commercial real estate, non-owner occupied			644,850		618,879		610,582
Construction and land development			852,418		708,289		607,798
Multi-family			529,727		466,804		396,272
Direct financing leases			50,237		56,153		60,134
1-4 family real estate			376,067		382,142		368,927
Consumer			71,682		69,438		71,080
Total loans/leases		$	4,599,730	$	4,417,705	$	4,361,051
Less allowance for credit losses (2)			80,670		78,894		81,831
Net loans/leases		$	4,519,060	$	4,338,811	$	4,279,220
Loan/lease mix: (1)
Commercial and industrial loans		$	1,634,047	$	1,680,853	$	1,779,062	$	1,726,723	$	1,823,049
Commercial real estate loans			2,550,160		2,319,423		2,174,897		2,107,629		1,999,715
Direct financing leases			49,585		55,371		59,229		66,016		73,011
Residential real estate loans			270,522		268,193		254,900		252,121		245,032
Installment and other consumer loans			85,363		86,925		87,053		91,302		102,471
Deferred loan/lease origination costs, net of fees			10,053		6,940		5,910		7,338		4,699
Total loans/leases		$	4,599,730	$	4,417,705	$	4,361,051	$	4,251,129	$	4,247,977
Less allowance for credit losses (2)			80,670		78,894		81,831		84,376		79,582
Net loans/leases		$	4,519,060	$	4,338,811	$	4,279,220	$	4,166,753	$	4,168,395
ANALYSIS OF SECURITIES PORTFOLIO
Securities mix:
U.S. government sponsored agency securities		$	23,689	$	14,670	$	14,581	$	15,336	$	18,437
Municipal securities			649,486		641,603		614,649		627,523		569,075
Residential mortgage-backed and related securities			100,744		106,139		118,051		132,842		134,147
Asset backed securities			30,607		31,778		39,815		40,683		40,665
Other securities			24,367		16,429		12,903		21,747		19,764
Total securities		$	828,893	$	810,619	$	799,999	$	838,131	$	782,088
Less allowance for credit losses (2)			174		174		174		-		-
Net securities		$	828,719	$	810,445	$	799,825	$	838,131	$	782,088
ANALYSIS OF DEPOSITS
Deposit mix:
Noninterest-bearing demand deposits		$	1,342,273	$	1,258,885	$	1,269,578	$	1,145,378	$	1,175,085
Interest-bearing demand deposits			3,086,711		2,976,696		2,916,054		2,987,469		2,938,194
Time deposits			441,743		452,171		445,067		460,659		499,021
Brokered deposits			1,101		1,183		1,084		5,631		59,968
Total deposits		$	4,871,828	$	4,688,935	$	4,631,782	$	4,599,137	$	4,672,268
ANALYSIS OF BORROWINGS
Borrowings mix:
Term FHLB advances		$	-	$	-	$	-	$	-	$	40,000
Overnight FHLB advances (3)			30,000		40,000		25,000		15,000		-
FRB borrowings			-		-		-		-		-
Other short-term borrowings			1,600		7,070		6,840		5,430		30,430
Subordinated notes			113,811		113,771		118,731		118,691		118,577
Junior subordinated debentures			38,103		38,067		38,030		37,993		37,955
Total borrowings		$	183,514	$	198,908	$	188,601	$	177,114	$	226,962
(1) The Company adopted ASU 2016-13 "CECL", effective January 1, 2021, which included a change in class of receivable and segment categories.
(2) The Company adopted ASU 2016-13 "CECL", effective January 1, 2021, which requires an allowance for credit losses ("ACL") on loans/leases, off-balance sheet ("OBS") exposures and held to maturity ("HTM") securities, recorded through the income statement within the provision for credit losses. The Day 1 adjustments to ACL were as follows: loans/leases ($8.1) million, OBS $9.1 million, HTM securities $183 thousand.
(3) At the most recent quarter-end, the weighted-average rate of these overnight borrowings was 0.30%.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
			For the Quarter Ended
			September 30,			June 30,			March 31,		December 31,			September 30,
				2021			2021			2021		2020			2020
			(dollars in thousands, except per share data)
INCOME STATEMENT
Interest income			$	51,667		$	48,903		$	47,565	$	49,851		$	50,890
Interest expense				5,438			5,387			5,590		6,144			6,309
Net interest income				46,229			43,516			41,975		43,707			44,581
Provision for credit losses (1)				-			-			6,713		7,080			20,342
Net interest income after provision for loan/lease losses			$	46,229		$	43,516		$	35,262	$	36,627		$	24,239
Trust department fees			$	2,714		$	2,848		$	2,801	$	2,388		$	2,280
Investment advisory and management fees				1,054			1,039			940		926			1,266
Deposit service fees				1,588			1,492			1,408		1,875			1,403
Gain on sales of residential real estate loans				954			1,184			1,337		1,462			1,370
Gain on sales of government guaranteed portions of loans				-			-			-		224			-
Swap fee income/capital markets revenue				24,885			9,568			13,557		21,402			26,688
Securities gains (losses), net				-			(88	)		-		617			1,802
Earnings on bank-owned life insurance				446			451			471		461			502
Debit card fees				1,085			1,084			975		923			946
Correspondent banking fees				265			269			314		270			220
Other				1,661			1,449			1,686		1,469			1,482
Total noninterest income			$	34,652		$	19,296		$	23,489	$	32,017		$	37,959
Salaries and employee benefits			$	28,207		$	23,044		$	24,847	$	30,446		$	25,999
Occupancy and equipment expense				4,122			3,965			4,108		4,917			3,807
Professional and data processing fees				3,568			3,702			3,443		3,871			3,758
Post-acquisition compensation, transition and integration costs				-			-			-		25			(32	)
Disposition costs				-			-			8		64			192
FDIC insurance, other insurance and regulatory fees				1,108			986			1,065		1,272			1,301
Loan/lease expense				308			457			300		465			403
Net cost of (income from) and gains/losses on operations of other real estate				(1,346	)		(113	)		39		(4	)		16
Advertising and marketing				1,095			853			627		1,276			750
Bank service charges				525			572			523		523			488
Losses on liability extinguishment				-			-			-		1,457			1,874
Correspondent banking expense				201			198			200		205			205
Intangibles amortization				508			508			508		521			531
Loss (gain) on sale of subsidiary				-			-			-		(147	)		305
Other				3,091			1,503			1,560		1,473			1,241
Total noninterest expense			$	41,387		$	35,675		$	37,228	$	46,364		$	40,838
Net income before income taxes			$	39,494		$	27,137		$	21,523	$	22,280		$	21,360
Federal and state income tax expense				7,929			4,788			3,541		4,009			4,016
Net income			$	31,565		$	22,349		$	17,982	$	18,271		$	17,344
Basic EPS			$	2.02		$	1.41		$	1.14	$	1.16		$	1.10
Diluted EPS			$	1.99		$	1.39		$	1.12	$	1.14		$	1.09
Weighted average common shares outstanding				15,635,123			15,813,932			15,803,643		15,775,596			15,767,152
Weighted average common and common equivalent shares outstanding				15,869,798			16,045,239			16,025,548		15,973,054			15,923,578
(1) Provision for credit losses only included provision for loans/leases for years prior to 2021.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
			For Nine Months Ended
			September 30,				September 30,
				2021				2020
			(dollars in thousands, except per share data)
INCOME STATEMENT
Interest income			$	148,135			$	148,522
Interest expense				16,415				25,279
Net interest income				131,720				123,243
Provision for credit losses (1)				6,713				48,624
Net interest income after provision for loan/lease losses			$	125,007			$	74,619
Trust department fees			$	8,363			$	6,819
Investment advisory and management fees				3,033				4,392
Deposit service fees				4,488				4,166
Gain on sales of residential real estate loans				3,475				3,218
Swap fee income/capital markets revenue				48,010				53,419
Securities gains (losses), net				(88	)			1,867
Earnings on bank-owned life insurance				1,368				1,443
Debit card fees				3,144				2,479
Correspondent banking fees				848				633
Other				4,796				3,345
Total noninterest income			$	77,437			$	81,781
Salaries and employee benefits			$	76,098			$	65,822
Occupancy and equipment expense				12,195				11,587
Professional and data processing fees				10,713				10,773
Post-acquisition compensation, transition and integration costs				-				189
Disposition costs				8				626
FDIC insurance, other insurance and regulatory fees				3,159				2,892
Loan/lease expense				1,065				970
Net cost of (income from) and gains/losses on operations of other real estate				(1,420	)			(303	)
Advertising and marketing				2,575				1,984
Bank service charges				1,620				1,493
Losses on liability extinguishment				-				2,450
Correspondent banking expense				599				633
Intangibles amortization				1,524				1,628
Goodwill impairment				-				500
Loss on sale of subsidiary				-				305
Other				6,154				3,842
Total noninterest expense			$	114,290			$	105,391
Net income before income taxes			$	88,154			$	51,009
Federal and state income tax expense				16,258				8,698
Net income			$	71,896			$	42,311
Basic EPS			$	4.54			$	2.68
Diluted EPS			$	4.48			$	2.65
Weighted average common shares outstanding				15,829,124				15,770,335
Weighted average common and common equivalent shares outstanding				16,058,420				15,945,832
(1) Provision for credit losses only included provision for loans/leases for years prior to 2021.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
		As of and for the Quarter Ended																For the Nine Months Ended
		September 30,			June 30,			March 31,			December 31,			September 30,				September 30,			September 30,
			2021			2021			2021			2020			2020				2021			2020
		(dollars in thousands, except per share data)
COMMON SHARE DATA
Common shares outstanding			15,590,428			15,763,522			15,843,732			15,805,711			15,792,357
Book value per common share (1)		$	41.68		$	40.00		$	38.42		$	37.57		$	36.26
Tangible book value per common share (Non-GAAP) (2)		$	36.30		$	34.64		$	33.06		$	32.16		$	30.82
Closing stock price		$	51.44		$	48.09		$	47.22		$	39.59		$	27.41
Market capitalization		$	801,972		$	758,068		$	748,141		$	625,748		$	432,869
Market price / book value			123.42	%		120.24	%		122.90	%		105.38	%		75.60	%
Market price / tangible book value			141.72	%		138.83	%		142.83	%		123.09	%		88.95	%
Earnings per common share (basic) LTM (3)		$	5.73		$	4.81		$	4.27		$	3.84		$	3.69
Price earnings ratio LTM (3)			8.98	x		10.00	x		11.06	x		10.31	x		7.43	x
TCE / TA (Non-GAAP) (4)			9.54	%		9.55	%		9.42	%		9.08	%		8.42	%
CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
Beginning balance		$	630,476		$	608,719		$	593,793		$	572,613		$	556,020
Cumulative effect from the adoption of ASU 2016-13 "CECL"			-			-			(937	)		-			-
Net income			31,565			22,349			17,982			18,271			17,344
Other comprehensive income (loss), net of tax			(2,546	)		4,179			(1,751	)		3,157			(614	)
Common stock cash dividends declared			(946	)		(951	)		(949	)		(947	)		(945	)
Repurchase and cancellation of shares of common stock as a result of a share repurchase program			(9,367	)		(4,800	)		-			-			-
Other (5)			632			980			581			699			808
Ending balance		$	649,814		$	630,476		$	608,719		$	593,793		$	572,613
REGULATORY CAPITAL RATIOS (6):
Total risk-based capital ratio			14.51	%		14.72	%		14.85	%		14.95	%		14.93	%
Tier 1 risk-based capital ratio			11.16	%		11.26	%		11.31	%		11.34	%		11.25	%
Tier 1 leverage capital ratio			10.28	%		10.29	%		10.10	%		9.49	%		9.21	%
Common equity tier 1 ratio			10.45	%		10.52	%		10.55	%		10.55	%		10.44	%
KEY PERFORMANCE RATIOS AND OTHER METRICS
Return on average assets (annualized)			2.12	%		1.56	%		1.27	%		1.25	%		1.19	%			1.66	%		1.02	%
Return on average total equity (annualized)			19.30	%		14.33	%		11.91	%		12.43	%		12.06	%			15.27	%		10.51	%
Net interest margin			3.36	%		3.28	%		3.26	%		3.25	%		3.36	%			3.30	%		3.29	%
Net interest margin (TEY) (Non-GAAP)(7)			3.56	%		3.46	%		3.43	%		3.45	%		3.51	%			3.49	%		3.44	%
Efficiency ratio (Non-GAAP) (8)			51.17	%		56.80	%		56.87	%		61.23	%		49.48	%			54.64	%		51.40	%
Gross loans and leases / total assets			76.48	%		76.10	%		77.25	%		74.81	%		72.43	%			76.48	%		72.43	%
Gross loans and leases / total deposits			94.41	%		94.22	%		94.15	%		92.43	%		90.92	%			94.41	%		90.92	%
Effective tax rate			20.08	%		17.64	%		16.45	%		17.99	%		18.80	%			18.44	%		17.05	%
Full-time equivalent employees (9)			724			725			720			714			687				724			687
AVERAGE BALANCES
Assets		$	5,960,336		$	5,739,067		$	5,668,850		$	5,842,299		$	5,820,555			$	5,789,753		$	5,524,087
Loans/leases			4,529,136			4,412,322			4,271,782			4,250,951			4,185,275				4,405,355			3,957,903
Deposits			4,779,876			4,709,732			4,628,889			4,742,602			4,726,881				4,706,719			4,472,328
Total stockholders' equity			654,186			624,000			604,012			588,042			575,061				627,583			536,578
(1) Includes accumulated other comprehensive income (loss).
(2) Includes accumulated other comprehensive income (loss) and excludes intangible assets (Non-GAAP).
(3) LTM : Last twelve months.
(4) TCE / TCA : tangible common equity / total tangible assets. See GAAP to non-GAAP reconciliations.
(5) Includes mostly common stock issued for options exercised and the employee stock purchase plan, as well as stock-based compensation.
(6) Ratios for the current quarter are subject to change upon final calculation for regulatory filings due after earnings release.
(7) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.
(8) See GAAP to Non-GAAP reconciliations.
(9) Growth in full-time equivalents from September 30, 2020 to December 31, 2020 due to the addition of new positions created to build scale.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
ANALYSIS OF NET INTEREST INCOME AND MARGIN
		For the Quarter Ended
		September 30, 2021							June 30, 2021							September 30, 2020
		AverageBalance		InterestEarned orPaid		AverageYield or Cost			AverageBalance		InterestEarned orPaid		AverageYield or Cost			AverageBalance		InterestEarned orPaid		AverageYield or Cost
		(dollars in thousands)
Fed funds sold		$	3,030	$	1	0.10	%		$	1,817	$	1	0.06	%		$	2,205	$	1	0.18	%
Interest-bearing deposits at financial institutions			99,024		39	0.16	%			88,396		35	0.16	%			321,679		92	0.11	%
Securities (1)			799,471		7,646	3.82	%			798,732		7,294	3.66	%			749,425		6,836	3.66	%
Restricted investment securities			20,910		262	4.97	%			19,614		238	4.79	%			19,714		249	4.94	%
Loans (1)			4,529,136		46,427	4.07	%			4,412,322		43,776	3.98	%			4,185,275		45,654	4.34	%
Total earning assets (1)		$	5,451,571	$	54,375	3.96	%		$	5,320,881	$	51,344	3.87	%		$	5,278,298	$	52,832	3.99	%
Interest-bearing deposits		$	3,041,941	$	2,183	0.28	%		$	2,978,382	$	2,050	0.28	%		$	2,932,988	$	2,086	0.28	%
Time deposits			461,210		1,090	0.94	%			440,599		1,184	1.08	%			638,031		2,399	1.50	%
Short-term borrowings			6,858		1	0.10	%			10,883		1	0.05	%			26,996		11	0.17	%
Federal Home Loan Bank advances			54,293		41	0.30	%			21,802		15	0.28	%			57,078		211	1.45	%
Subordinated debentures			113,789		1,554	5.46	%			115,339		1,570	5.45	%			77,783		1,031	5.30	%
Junior subordinated debentures			38,084		569	5.84	%			38,044		564	5.86	%			37,936		571	5.89	%
Total interest-bearing liabilities		$	3,716,175	$	5,438	0.58	%		$	3,605,049	$	5,384	0.60	%		$	3,770,812	$	6,309	0.66	%
Net interest income (1)				$	48,937						$	45,960						$	46,523
Net interest margin (2)						3.36	%						3.28	%						3.36	%
Net interest margin (TEY) (Non-GAAP) (1) (2) (3)						3.56	%						3.46	%						3.51	%
Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)						3.53	%						3.44	%						3.44	%
		For the Nine Months Ended
		September 30, 2021							September 30, 2020
		AverageBalance		InterestEarned orPaid		Average Yield or Cost			AverageBalance		InterestEarned orPaid		AverageYield or Cost
		(dollars in thousands)
Fed funds sold		$	1,503	$	1	0.13	%		$	2,795	$	19	0.89	%
Interest-bearing deposits at financial institutions			101,225		110	0.15	%			327,902		587	0.24	%
Securities (1)			802,715		21,989	3.65	%			688,985		19,567	3.78	%
Restricted investment securities			19,540		718	4.85	%			20,767		795	5.03	%
Loans (1)			4,405,355		132,728	4.03	%			3,957,903		133,141	4.49	%
Total earning assets (1)		$	5,330,338	$	155,546	3.90	%		$	4,998,352	$	154,109	4.12	%
Interest-bearing deposits		$	3,000,766	$	6,219	0.28	%		$	2,718,613	$	9,920	0.49	%
Time deposits			449,996		3,716	1.10	%			743,746		9,537	1.71	%
Short-term borrowings			7,560		4	0.08	%			23,804		81	0.45	%
Federal Home Loan Bank advances			29,875		66	0.29	%			87,920		1,007	1.50	%
Subordinated debentures			115,927		4,718	5.43	%			71,582		3,019	5.63	%
Junior subordinated debentures			38,045		1,692	5.86	%			37,894		1,715	5.95	%
Total interest-bearing liabilities		$	3,642,169	$	16,415	0.60	%		$	3,683,559	$	25,279	0.91	%
Net interest income (1)				$	139,131						$	128,830
Net interest margin (2)						3.30	%						3.29	%
Net interest margin (TEY) (Non-GAAP) (1) (2) (3)						3.49	%						3.44	%
Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)						3.46	%						3.38	%
(1) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% tax rate.
(2) See "Select Financial Data - Subsidiaries" for a breakdown of amortization/accretion included in net interest margin for each period presented.
(3) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
		As of
		September 30,			June 30,			March 31,			December 31,			September 30,
			2021			2021			2021			2020			2020
		(dollars in thousands, except per share data)
ROLLFORWARD OF ALLOWANCE FOR CREDIT LOSSES ON LOANS/LEASES
Beginning balance		$	78,894		$	81,831		$	84,376		$	79,582		$	60,827
Adoption of ASU 2016-13 "CECL" - Day 1 adjustment			-			-			(8,102	)		-			-
Provision charged to expense			1,895			(141	)		5,993			7,080			20,342
Loans/leases charged off			(287	)		(3,674	)		(713	)		(2,779	)		(1,819	)
Recoveries on loans/leases previously charged off			168			878			277			493			232
Ending balance		$	80,670		$	78,894		$	81,831		$	84,376		$	79,582
NONPERFORMING ASSETS
Nonaccrual loans/leases		$	6,818		$	8,230		$	13,863		$	13,940		$	17,597
Accruing loans/leases past due 90 days or more			14			57			-			3			86
Total nonperforming loans/leases			6,832			8,287			13,863			13,943			17,683
Other real estate owned			-			1,820			173			20			125
Other repossessed assets			-			-			50			135			110
Total nonperforming assets		$	6,832		$	10,107		$	14,086		$	14,098		$	17,918
ASSET QUALITY RATIOS
Nonperforming assets / total assets			0.11	%		0.17	%		0.25	%		0.25	%		0.31	%
ACL for loans and leases / total loans/leases (1)			1.75	%		1.79	%		1.88	%		1.98	%		1.87	%
ACL for loans and leases / nonperforming loans/leases (1)			1180.77	%		952.02	%		590.28	%		605.15	%		450.05	%
Net charge-offs as a % of average loans/leases			0.00	%		0.06	%		0.01	%		0.05	%		0.04	%
INTERNALLY ASSIGNED RISK RATING (2)
Special mention (rating 6)		$	58,634		$	51,613		$	53,466		$	71,482		$	79,587
Substandard (rating 7)			59,402			79,719			84,982			66,081			70,409
Doubtful (rating 8)			-			-			-			-			-
		$	118,036		$	131,332		$	138,448		$	137,563		$	149,996
Criticized loans (3)		$	118,036		$	131,332		$	138,448		$	137,563		$	149,996
Classified loans (4)			59,402			79,719			84,982			66,081			70,409
Criticized loans as a % of total loans/leases			2.57	%		2.97	%		3.17	%		3.24	%		3.53	%
Classified loans as a % of total loans/leases			1.29	%		1.80	%		1.95	%		1.55	%		1.66	%
(1) Prior to adoption of ASU 2016-13 "CECL", upon acquisition and per GAAP, acquired loans were recorded at market value, which eliminates the allowance and impacts this ratio. There have been no acquisitions since adopting ASU 2016-13 "CECL", which requires an allowance to be established on acquired loans.
(2) Amounts exclude the government guaranteed portion, if any. The Company assigns internal risk ratings of Pass (Rating 2) for the government guaranteed portion.
(3) Criticized loans are defined as C&I and CRE loans with internally assigned risk ratings of 6, 7, or 8, regardless of performance.
(4) Classified loans are defined as C&I and CRE loans with internally assigned risk ratings of 7 or 8, regardless of performance.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
				For the Quarter Ended												For the Nine Months Ended
				September 30,				June 30,				September 30,				September 30,				September 30,
		SELECT FINANCIAL DATA - SUBSIDIARIES			2021				2021				2020				2021				2020
				(dollars in thousands)
		TOTAL ASSETS
		Quad City Bank and Trust (1)		$	2,106,631			$	2,059,634			$	2,205,935
		m2 Equipment Finance, LLC			259,543				255,338				241,452
		Cedar Rapids Bank and Trust			2,019,018				1,913,761				2,012,182
		Community State Bank - Ankeny			1,140,933				1,079,929				937,017
		Springfield First Community Bank			880,143				850,067				803,478
		TOTAL DEPOSITS
		Quad City Bank and Trust (1)		$	1,797,969			$	1,810,772			$	1,955,360
		Cedar Rapids Bank and Trust			1,526,144				1,395,721				1,399,267
		Community State Bank - Ankeny			994,042				938,428				822,261
		Springfield First Community Bank			605,947				608,676				592,528
		TOTAL LOANS & LEASES
		Quad City Bank and Trust (1)		$	1,636,170			$	1,577,681			$	1,556,798
		m2 Equipment Finance, LLC			262,962				258,520				241,783
		Cedar Rapids Bank and Trust			1,410,160				1,360,202				1,387,372
		Community State Bank - Ankeny			834,533				786,208				683,086
		Springfield First Community Bank			718,867				693,614				620,721
		TOTAL LOANS & LEASES / TOTAL DEPOSITS
		Quad City Bank and Trust (1)			91	%			87	%			80	%
		Cedar Rapids Bank and Trust			92	%			97	%			99	%
		Community State Bank - Ankeny			84	%			84	%			83	%
		Springfield First Community Bank			119	%			114	%			105	%
		TOTAL LOANS & LEASES / TOTAL ASSETS
		Quad City Bank and Trust (1)			78	%			77	%			71	%
		Cedar Rapids Bank and Trust			70	%			71	%			69	%
		Community State Bank - Ankeny			73	%			73	%			73	%
		Springfield First Community Bank			82	%			82	%			77	%
		ACL ON LOANS/LEASES AS A PERCENTAGE OF LOANS/LEASES
		Quad City Bank and Trust (1)			1.88	%			1.91	%			1.86	%
		m2 Equipment Finance, LLC			3.78	%			3.61	%			2.53	%
		Cedar Rapids Bank and Trust (2)			1.85	%			1.92	%			2.22	%
		Community State Bank - Ankeny (2)			1.73	%			1.69	%			1.92	%
		Springfield First Community Bank (2)			1.30	%			1.35	%			1.09	%
		RETURN ON AVERAGE ASSETS
		Quad City Bank and Trust (1)			1.66	%			1.64	%			0.56	%			1.55	%			0.81	%
		Cedar Rapids Bank and Trust			3.93	%			2.39	%			2.66	%			2.95	%			2.25	%
		Community State Bank - Ankeny			1.17	%			1.16	%			0.82	%			1.05	%			0.53	%
		Springfield First Community Bank			2.09	%			1.77	%			1.52	%			1.69	%			1.28	%
		NET INTEREST MARGIN PERCENTAGE (3)
		Quad City Bank and Trust (1)			3.47	%			3.30	%			3.07	%			3.32	%			3.17	%
		Cedar Rapids Bank and Trust (4)			3.68	%			3.60	%			3.54	%			3.61	%			3.45	%
		Community State Bank - Ankeny (5)			3.78	%			3.66	%			4.12	%			3.71	%			3.94	%
		Springfield First Community Bank (6)			3.67	%			3.54	%			3.75	%			3.59	%			3.82	%
		ACQUISITION-RELATED AMORTIZATION/ACCRETION INCLUDED IN NET
		INTEREST MARGIN, NET
		Cedar Rapids Bank and Trust		$	64			$	92			$	217			$	169			$	327
		Community State Bank - Ankeny			52				68				56			$	437				193
		Springfield First Community Bank			376				168				598			$	755				1,791
		QCR Holdings, Inc. (7)			(36	)			(37	)			(38	)		$	(110	)			(117	)
(1)		Quad City Bank and Trust figures include m2 Equipment Finance, LLC, as this entity is wholly-owned and consolidated with the Bank. m2 Equipment Finance, LLC  is also presented separately for certain (applicable) measurements.
(2)		Prior to adoption of ASU 2016-13 "CECL", upon acquisition and per GAAP, acquired loans were recorded at market value, which eliminates the allowance and impacts this ratio. There have been no acquisitions since adopting ASU 2016-13 "CECL", which requires an allowance to be established on acquired loans.
(3)		Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% tax rate.
(4)		Cedar Rapids Bank and Trust's net interest margin percentage includes various purchase accounting adjustments. Excluding those adjustments, net interest margin (Non-GAAP) would have been 3.66% for the quarter ended September 30, 2021, 3.67% for the quarter ended June 30, 2021 and 3.46% for the quarter ended September 30, 2020.
(5)		Community State Bank's net interest margin percentage includes various purchase accounting adjustments. Excluding those adjustments, net interest margin (Non-GAAP) would have been 3.66% for the quarter ended September 30, 2021, 3.63% for the quarter ended June 30, 2021 and 4.06% for the quarter ended September 30, 2020.
(6)		Springfield First Community Bank's net interest margin percentage includes various purchase accounting adjustments. Excluding those adjustments, net interest margin (Non-GAAP) would have been 3.67% for the quarter ended September 30, 2021, 3.50% for the quarter ended June 30, 2021 and 4.02% for the quarter ended September 30, 2020.
(7)		Relates to the trust preferred securities acquired as part of the Guaranty Bank acquisition in 2017 and the Community National Bank acquisition in 2013.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
		As of
		September 30,				June 30,				March 31,				December 31,				September 30,
GAAP TO NON-GAAP RECONCILIATIONS			2021				2021				2021				2020				2020
		(dollars in thousands, except per share data)
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO (1)
Stockholders' equity (GAAP)		$	649,814			$	630,476			$	608,719			$	593,793			$	572,613
Less: Intangible assets			83,923				84,431				84,939				85,447				85,968
Tangible common equity (non-GAAP)		$	565,891			$	546,045			$	523,780			$	508,346			$	486,645
Total assets (GAAP)		$	6,014,508			$	5,805,165			$	5,645,147			$	5,682,797			$	5,864,560
Less: Intangible assets			83,923				84,431				84,939				85,447				85,968
Tangible assets (non-GAAP)		$	5,930,585			$	5,720,734			$	5,560,208			$	5,597,350			$	5,778,592
Tangible common equity to tangible assets ratio (non-GAAP)			9.54	%			9.55	%			9.42	%			9.08	%			8.42	%
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO EXCLUDING PPP LOANS (1)
Stockholder's equity (GAAP)		$	649,814			$	630,476			$	608,719			$	593,793			$	572,613
Less: PPP loan interest income (post-tax) (2)			12,297				10,788				9,479				7,691				4,934
Less: Intangible assets			83,923				84,431				84,939				85,447				85,968
Tangible common equity, excluding PPP loan income (non-GAAP)		$	553,594			$	535,257			$	514,301			$	500,655			$	481,711
Total assets (GAAP)		$	6,014,508			$	5,805,165			$	5,645,147			$	5,682,797			$	5,864,560
Less: PPP loans			83,575				147,506				243,860				273,146				357,506
Less: Intangible assets			83,923				84,431				84,939				85,447				85,968
Tangible assets, excluding PPP loans (non-GAAP)		$	5,847,010			$	5,573,228			$	5,316,348			$	5,324,204			$	5,421,086
Tangible common equity to tangible assets ratio, excluding PPP loans (non-GAAP)			9.47	%			9.60	%			9.67	%			9.40	%			8.89	%
(1) This ratio is a non-GAAP financial measure. The Company's management believes that this measurement is important to many investors in the marketplace who are interested in changes period-to-period in common equity. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to stockholders' equity and total assets, which are the most directly comparable GAAP financial measures.
(2) PPP interest income (post-tax) is calculated using an estimated effective tax rate of 21%.

QCR Holdings, Inc.Consolidated Financial Highlights(Unaudited)
GAAP TO NON-GAAP RECONCILIATIONS		For the Quarter Ended																				For the Nine Months Ended
		September 30,				June 30,				March 31,				December 31,				September 30,				September 30,				September 30,
ADJUSTED NET INCOME (1)			2021				2021				2021				2020				2020				2021				2020
		(dollars in thousands, except per share data)
Net income (GAAP)		$	31,565			$	22,349			$	17,982			$	18,271			$	17,344			$	71,896			$	42,311
Less non-core items (post-tax) (2):
Income:
Securities gains(losses), net			-				(69	)			-				487				1,424			$	(69	)		$	1,475
Mark to Market gains (losses) on derivatives, net			(13	)			(58	)			129				-				-				58			$	-
Gain on sale of loan			28				-				-				-				-				28
Loss on syndicated loan			-				-				-				(210	)			-				-			$	-
Total non-core income (non-GAAP)		$	15			$	(127	)		$	129			$	277			$	1,424			$	17			$	1,475
Expense:
Losses on debt extinguishment, net		$	-			$	-			$	-			$	1,151			$	1,480			$	-			$	1,936
Goodwill impairment			-				-				-				-				-				-				500
Disposition costs			-				-				7				51				152				7				495
Acquisition costs (4)			-				-				-				-				-				-				-
Separation agreement			-				-				734				-				-				734				-
Post-acquisition compensation, transition and integration costs			-				-				-				20				(25	)			-				149
Loss on sale of subsidiary			-				-				-				(102	)			212				-				212
Total non-core expense (non-GAAP)		$	-			$	-			$	741			$	1,119			$	1,819			$	741			$	3,291
Adjusted net income (non-GAAP) (1)		$	31,550			$	22,476			$	18,594			$	19,113			$	17,739			$	72,620			$	44,127
ADJUSTED EARNINGS PER COMMON SHARE (1)
Adjusted net income (non-GAAP) (from above)		$	31,550			$	22,476			$	18,594			$	19,113			$	17,739			$	72,620			$	44,127
Weighted average common shares outstanding			15,635,123				15,813,932				15,803,643				15,775,596				15,767,152				15,829,124				15,770,335
Weighted average common and common equivalent shares outstanding			15,869,798				16,045,239				16,025,548				15,973,054				15,923,578				16,058,420				15,945,832
Adjusted earnings per common share (non-GAAP):
Basic		$	2.02			$	1.42			$	1.18			$	1.21			$	1.13			$	4.59			$	2.80
Diluted		$	1.99			$	1.40			$	1.16			$	1.20			$	1.11			$	4.52			$	2.77
ADJUSTED RETURN ON AVERAGE ASSETS (1)
Adjusted net income (non-GAAP) (from above)		$	31,550			$	22,476			$	18,594			$	19,113			$	17,739			$	72,620			$	44,127
Average Assets		$	5,960,336			$	5,739,067			$	5,668,850			$	5,842,299			$	5,820,555			$	5,789,753			$	5,524,087
Adjusted return on average assets (annualized) (non-GAAP)			2.12	%			1.57	%			1.31	%			1.31	%			1.22	%			1.67	%			1.07	%
NET INTEREST MARGIN (TEY) (4)
Net interest income (GAAP)		$	46,229			$	43,516			$	41,975			$	43,707			$	44,581			$	131,720			$	123,243
Plus: Tax equivalent adjustment (3)			2,708				2,444				2,267				2,631				1,942				7,411				5,587
Net interest income - tax equivalent (Non-GAAP)		$	48,937			$	45,960			$	44,242			$	46,338			$	46,523			$	139,131			$	128,830
Less: Acquisition accounting net accretion			456				291				504				1,077				833				1,251				2,194
Adjusted net interest income		$	48,481			$	45,669			$	43,738			$	45,261			$	45,690			$	137,880			$	126,636
Average earning assets		$	5,451,571			$	5,320,881			$	5,218,198			$	5,345,677			$	5,278,298			$	5,330,338			$	4,998,352
Net interest margin (GAAP)			3.36	%			3.28	%			3.26	%			3.25	%			3.36	%			3.30	%			3.29	%
Net interest margin (TEY) (Non-GAAP)			3.56	%			3.46	%			3.43	%			3.45	%			3.51	%			3.49	%			3.44	%
Adjusted net interest margin (TEY) (Non-GAAP)			3.53	%			3.44	%			3.40	%			3.37	%			3.44	%			3.46	%			3.38	%
EFFICIENCY RATIO (5)
Noninterest expense (GAAP)		$	41,387			$	35,675			$	37,228			$	46,364			$	40,838			$	114,290			$	105,391
Net interest income (GAAP)		$	46,229			$	43,516			$	41,975			$	43,707			$	44,581			$	131,720			$	123,243
Noninterest income (GAAP)			34,652				19,296				23,489				32,017				37,959				77,437				81,781
Total income		$	80,881			$	62,812			$	65,464			$	75,724			$	82,540			$	209,157			$	205,024
Efficiency ratio (noninterest expense/total income) (Non-GAAP)			51.17	%			56.80	%			56.87	%			61.23	%			49.48	%			54.64	%			51.40	%
ALLOWANCE FOR CREDIT LOSSES ON LOANS/LEASES TO TOTAL LOANS/LEASES, EXCLUDING PPP LOANS (6)
Allowance for credit losses on loans and leases		$	80,670			$	78,894			$	81,831			$	84,376			$	79,582			$	80,670			$	79,582
Total loans and leases		$	4,599,730			$	4,417,705			$	4,361,051			$	4,251,129			$	4,247,977			$	4,599,730			$	4,247,977
Less: PPP loans			83,575				147,506				243,860				273,146				357,506				83,575				357,506
Total loans and leases, excluding PPP loans		$	4,516,155			$	4,270,199			$	4,117,191			$	3,977,983			$	3,890,471			$	4,516,155			$	3,890,471
Allowance for credit losses on loans and leases to total loans and leases, excluding PPP loans			1.79	%			1.85	%			1.99	%			2.12	%			2.05	%			1.79	%			2.05	%
LOAN GROWTH ANNUALIZED, EXCLUDING PPP LOANS
Total loans and leases		$	4,599,730			$	4,417,705			$	4,361,051			$	4,251,129			$	4,247,977			$	4,599,730			$	4,247,977
Less: PPP loans			83,575				147,506				243,860				273,146				357,506				83,575				357,506
Total loans and leases, excluding PPP loans		$	4,516,155			$	4,270,199			$	4,117,191			$	3,977,983			$	3,890,471			$	4,516,155			$	3,890,471
Loan growth annualized, excluding PPP loans			23.04	%			14.87	%			14.00	%			9.00	%			11.45	%			16.08	%			16.28	%
(1) Adjusted net income, Adjusted net income attributable to QCR Holdings, Inc. common stockholders, Adjusted earnings per common share and Adjusted return on average assets are non-GAAP financial measures. The Company's management believes that these measurements are important to investors as they exclude non-recurring income and expense items, therefore, they provide a more realistic run-rate for future periods. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net income, which is the most directly comparable GAAP financial measure.
(2) Nonrecurring items (post-tax) are calculated using an estimated effective tax rate of 21% with the exception of goodwill impairment which is not deductible for tax and gain/loss on sale of assets and liabilities of subsidiary has an estimated effective tax rate of 30.5%.
(3) Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21%.
(4) Net interest margin (TEY) is a non-GAAP financial measure. The Company's management utilizes this measurement to take into account the tax benefit associated with certain loans and securities. It is also standard industry practice to measure net interest margin using tax-equivalent measures. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net interest income, which is the most directly comparable GAAP financial measure. In addition, the Company calculates net interest margin without the impact of acquisition accounting net accretion as this can fluctuate and it's difficult to provide a more realistic run-rate for future periods.
(5) Efficiency ratio is a non-GAAP measure. The Company's management utilizes this ratio to compare to industry peers. The ratio is used to calculate overhead as a percentage of revenue. In compliance with the applicable rules of the SEC, this non-GAAP measure is reconciled to noninterest expense, net interest income and noninterest income, which are the most directly comparable GAAP financial measures.
(6) Allowance for credit losses on loans and leases to total loans and leases, excluding PPP loans is a non-GAAP measure. The Company's management utilizes this ratio to remove from the allowance calculation the impact of PPP loans which are fully guaranteed by the federal government and for which these loans have no allowance for loan and lease loss allocation.